Rutgers Reports on Employment Trends

Though unemployment has risen to its highest rate in 26 years, a new study by Rutgers’ School of Management and Labor Relations, SMLR, states that those of us still employed are doing better than what might be expected.

According to Rutgers’ second annual Labor Scorecard, compiled by SMLR and released on Labor Day, average inflation-adjusted earnings have actually increased 5 percent from 2008 for nonsupervisory workers, and median earnings for all wage and salary workers are 5 to 7 percent higher than they were 10 years ago.

According to SMLR professor Douglas Kruse, the federal minimum wage, now $7.25 an hour, is 9 percent higher than in 1999, after adjusting for inflation.

A second bright spot is that while wage gaps for women and minorities still exist, earnings disparities have closed somewhat, according to SMLR dean David Finegold. Women who work full time still earn 20 percent less than men, but the gap has decreased from 24 percent in 1999, Finegold said. Similarly, full-time black and Hispanic workers earn 22 percent and 28 percent less than white workers, respectively, but the respective gaps were 24 percent and 34 percent a decade ago.

Pay inequality unrelated to race or sex, however, has been increasing. Full-time workers at the 90th percentile (earning more than 90 percent of workers) earned 451 percent more than those at the 10th percentile in 1999. This year, that figure has increased to 495 percent.

Employee benefits present a mixed picture. Much as it was a decade ago, two-thirds of workers have access to employer-sponsored health insurance and half of all workers participate in those plans. But single covered workers have reported that their inflation-adjusted contributions to health care have increased by 75 percent over this same time frame. Those with family coverage now pay 68 percent more on average.

Employers report spending more for benefits and total compensation, which partly reflects the increased weight of health care costs they bear for their workers, the report states. The percentage of workers covered by traditional pension plans that pay defined retirement benefits has remained stable at close to 20 percent over the past decade, and 43 percent of workers are now covered by 401(k) or other plans where workers bear the investment risk. That is up from 36 percent in 1999.

About three-quarters of workers have access to paid holidays and paid vacation, the same as 10 years ago. Two-thirds of workers now have access to sick leave. Slightly more than half had that benefit in 1999.

While the employed are enjoying better earning power, however, the picture of unemployment remains bleak.

The current unemployment rate nationally is 9.7 percent. Rutgers factored underemployed, discouraged, and “other marginally attached workers” into its calculations and reported that counting those workers, national unemployment hits 16.8 percent.

Kruse noted that some workers are adjusting by taking part-time jobs, and that the number of part-timers has increased to one in five workers.

The scorecard, which summarizes a wide range of indicators in 16 categories, from employment and earnings to health and retirement benefits, uses data from government and nongovernment sources to chart decade-long trends where data is available.

The scorecard also finds that job market stresses have disproportionately affected minorities and people with disabilities. The unemployment rate is 8.6 percent for whites, but it is 14.5 percent for blacks, 12.3 percent for Hispanics, and 15.1 percent for people with disabilities.

Formal complaints of employment discrimination and labor law violations in union elections have been increasing steadily for the last 10 years, the scorecard finds, though complaints of violations of other employment laws seem to have decreased. SMLR speculates that this perhaps is due to a lack of attention and enforcement.

The overall percentage of workers in unions, however, increased slightly to 12.4 percent in 2008 after a long decline.

For more information, or to read the complete SMLR Labor Scorecard, visit http://smlr.rutgers.edu/misc/index.html.